Hi,
I wanted to know whether earned leave encashed at the time of resignation is entired tax exempt?
Could anyone please give me more information on this.
1. Is there a cap on the amount that is tax exempt or not?
2. Under what condition is it exempt, e.g., upon termination or resignation or only during final retirement.
3. Under which act is the tax exemption given?
Thanks,
Sudha S.
From India, Bangalore
I wanted to know whether earned leave encashed at the time of resignation is entired tax exempt?
Could anyone please give me more information on this.
1. Is there a cap on the amount that is tax exempt or not?
2. Under what condition is it exempt, e.g., upon termination or resignation or only during final retirement.
3. Under which act is the tax exemption given?
Thanks,
Sudha S.
From India, Bangalore
Hi
Earned Leave encashed is taken in to total income of the employee for the financial year , if the total income including earned leave encashed is below the exempted income slab then No, Income tax, if it exceeds more than the exempted income slab, it is taxable.
There is no exemption of Income Tax on earned leave encashed.
Mohan Rao
Manager HR
From India, Visakhapatnam
22Earned Leave encashed is taken in to total income of the employee for the financial year , if the total income including earned leave encashed is below the exempted income slab then No, Income tax, if it exceeds more than the exempted income slab, it is taxable.
There is no exemption of Income Tax on earned leave encashed.
Mohan Rao
Manager HR
From India, Visakhapatnam
Tax on Leave Encashment (mymisccollection) <link updated to site home> ( Search On Cite | Search On Google )
Leave Encashment should not be tax after ruling from Madras High Court.
For the purpose of Section 10(10AA), the term ‘Superannuation or otherwise’ covers resignation (CIT Vs. R.V. Shahney 159 ITR 160(Madras).
From India, Bangalore
Leave Encashment should not be tax after ruling from Madras High Court.
For the purpose of Section 10(10AA), the term ‘Superannuation or otherwise’ covers resignation (CIT Vs. R.V. Shahney 159 ITR 160(Madras).
From India, Bangalore
Dear Sudha S.
Leave encashment while in service is taxable. Encashment of sick leave is taxable.
Leave encashment received at the time of retirement is fully exempt in the case of Government Servants. In the case of non-Govt. Employees, leave encashment is exempt to the extent of the least of the following four amounts: -
* Rs. 3,00,000/-
* Ten months' average salary;
* Cash equivalent of the leave due at the time of retirement;
* Leave encashment actually received at the time of retirement.
Here the average salary means the average of the salary drawn during the last ten months before retirement. (source: Income Tax India)
For more details visit the given site..
Regards,
Pankaj Chandan
From India, New delhi
Leave encashment while in service is taxable. Encashment of sick leave is taxable.
Leave encashment received at the time of retirement is fully exempt in the case of Government Servants. In the case of non-Govt. Employees, leave encashment is exempt to the extent of the least of the following four amounts: -
* Rs. 3,00,000/-
* Ten months' average salary;
* Cash equivalent of the leave due at the time of retirement;
* Leave encashment actually received at the time of retirement.
Here the average salary means the average of the salary drawn during the last ten months before retirement. (source: Income Tax India)
For more details visit the given site..
Regards,
Pankaj Chandan
From India, New delhi
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Tax Exemption (SUPERB).doc
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